Review of Bank of Nova Scotia

JAN 29, 2026 - Since the new CEO joined in 2023, BNS has gradually regained business momentum through new operational priorities such as increasing the company’s focus on value over volume and strategically expanding into the U.S., while remaining willing to reduce operations in non-core markets such as Colombia and Costa Rica. These initiatives demonstrate improved operational discipline and have started to help the business move back on the right track. Despite management’s efforts to reorganize operations and optimize capital allocation, we believe there is still room for improvement. If fundamentals continue to improve, we see potential for BNS’s valuation multiple to re-rate toward levels more in line with its peers. While BNS may not be a life-changing opportunity, we continue to view it as a high-quality dividend grower with decent returns over time. We remain open to an upgrade if management can sustain business momentum; for now, we are maintaining our rating at “A-”.